CIRP timeline exclusion for COVID-19 lockdown allowed, with completion directed by a fixed date

The tribunal accepted that the COVID-19 lockdown period from 25.03.2020 to 07.06.2020 could be excluded while computing the Corporate Insolvency Resolution Process timeline. It noted that the CIRP had already been extended once, but held that the statutory scheme allowing completion within 330 days permitted a further direction to complete the process by a fixed date after excluding the lockdown period. The Resolution Professional was accordingly directed to complete the CIRP by 19.08.2020.

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Issues: Whether the Corporate Insolvency Resolution Process period could be extended and the period of lockdown due to COVID-19 excluded while directing completion of the process within the statutory limit.

Analysis: The application was filed under the insolvency code and the tribunal noted that the CIRP had already been extended once. It accepted that the lockdown period from 25.03.2020 to 07.06.2020 was excludable for CIRP computation. The tribunal further held that, in view of the statutory scheme permitting completion within 330 days and the circumstances of the case, a direction could be issued to complete the CIRP by a fixed date after excluding the lockdown period.

Conclusion: The request was accepted and the Resolution Professional was directed to complete the CIRP by 19.08.2020.

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